New Jersey’s State and Local Government Workforce is the Eleventh “Least Productive” in 2016

Dec 27, 2017

There are two major elements to look at when examining a state’s state and local government workforce—the number of employees and the level of their pay. In this analysis, each element is measured relative to the national average and summed together to obtain an overall measure of workforce productivity. Based on this state and local government workforce productivity index, New Jersey has the eleventh least productive state and local government workforce in the country.

As shown in Chart 1, for state and local government employment in 2016, New Jersey employed 15.2 employees for every 100 employees in the private sector (employment ratio) which is below the national average of 15.7 and is 15th lowest ratio in the country.

Additionally, New Jersey’s employment ratio has been increasing. As shown in Chart 2, between 1969 and 2016, the employment ratio grew by 19 percent to 15.2 in 2016 from 12.8 in 1969. This increase is the significantly faster than the national average which increased by 2 percent to 15.7 in 2016 from 15.4 in 1969.

As shown in Chart 3, for state and local government compensation in 2016, New Jersey government employees earning 23 percent more than those in the private sector (compensation ratio) which is 70 percent higher than the national average of 14 percent and is the 9th highest compensation ratio in the country.

Additionally, New Jersey’s compensation ratio has been increasing. As shown in Chart 4, between 1969 and 2016, the compensation ratio increased by 30 percentage points to 23 percent in 2016 from -7 percent in 1969. This is a faster growth rate than the national average which increased by 15 percentage points to 14 percent in 2016 from -1 percent in 1969.

As shown in Chart 5, it is state and local wages and salaries and benefits that are responsible for New Jersey’s high government compensation ratio. For state and local wages and salaries in 2016, New Jersey employees earn 1 percent more than those in the private sector which is the 10th highest wages and salaries ratio in the country and higher than the national average of -8 percent.

For state and local benefits in 2016, New Jersey employees earn 143 percent more than those in the private sector which is 13 percent higher than the national average of 127 percent and is the 7th highest benefit ratio in the country.

Of course, efficiency for local government helps to be measured on a more local scale. As such, we have also calculated the employment and compensations ratios of local government workers for every county in New Jersey.

The New Jersey local government employment ratios are (from highest to lowest):

Sussex County, NJ (21.4)

Cape May County, NJ (19.9)

Salem County, NJ (17.1)

Cumberland County, NJ (16.6)

Passaic County, NJ (15.7)

Warren County, NJ (15.5)

Gloucester County, NJ (15.3)

Ocean County, NJ (15.2)

Essex County, NJ (13.3)

Atlantic County, NJ (13.2)

Hunterdon County, NJ (12.7)

Union County, NJ (12.6)

Hudson County, NJ (12.5)

Monmouth County, NJ (12.1)

Camden County, NJ (11.8)

Burlington County, NJ (10.1)

Bergen County, NJ (9.2)

Mercer County, NJ (8.5)

Middlesex County, NJ (8.4)

Morris County, NJ (8.0)

Somerset County, NJ (7.9)

The New Jersey local government compensation ratios are (highest to lowest):

Cape May County, NJ (74 percent)

Atlantic County, NJ (66 percent)

Ocean County, NJ (65 percent)

Cumberland County, NJ (53 percent)

Passaic County, NJ (49 percent)

Gloucester County, NJ (44 percent)

Camden County, NJ (43 percent)

Sussex County, NJ (43 percent)

Warren County, NJ (38 percent)

Monmouth County, NJ (37 percent)

Burlington County, NJ (26 percent)

Essex County, NJ (22 percent)

Bergen County, NJ (19 percent)

Middlesex County, NJ (18 percent)

Mercer County, NJ (17 percent)

Union County, NJ (15 percent)

Salem County, NJ (9 percent)

Hunterdon County, NJ (9 percent)

Hudson County, NJ (4 percent)

Morris County, NJ (-8 percent)

Somerset County, NJ (-12 percent)

Overall, it is New Jersey’s high compensation ratio, driven by both wages and salaries benefits, that is the primary reason for New Jersey having the 11th worst state and local government workforce productivity index.

Finally, don’t forget to watch our exclusive time-lapse video of our state and local government workforce productivity index over the last 47 years! See if your state has been above or below the national average?

J. Scott Moody

Scott has nearly 20 years of experience as a public policy economist. He is the author, co-author and editor of over 180 studies and books. His professional experience also includes positions at the American Conservative Union Foundation, Granite Institute, Federalism In Action, Maine Heritage Policy Center, Tax Foundation, and Heritage Foundation.